Rents 'out of reach'

Talk about it

Despite falling home prices and foreclosures, rents remain unaffordable for most Minnesota families.

A new national report says that a two-bedroom apartment remains beyond the means of Minnesota’s average renting household in each of 87 counties.

Being able to afford rent, according to housing experts, is particularly important now. With so many foreclosures, demand for rentals is up. Rising unemployment and a lack of affordable housing have set the stage for increased homelessness.

In Douglas County, the fair market monthly rent for a two-bedroom apartment is $613, the report says.

In order to afford this level of rent and utilities without paying more than 30 percent of its income on housing, a household must earn $24,520 a year or $2,043 a month.

Yet the estimated median household income of families that are renting in Douglas County is just $23,902 a year, according to the report.

The report states that 50 percent of the renters in Douglas County are unable to afford a two-bedroom apartment at fair market rent.

To afford a one-bedroom apartment in Douglas County, a person with a minimum wage job – $6.55 an hour – would have to work 57 hours a week, the report states.

Douglas County isn’t the only county with out-of-reach rents.

In 50 Minnesota counties, a typical two-bedroom apartment requires an average renter household to pay more than 90 percent of its income on rent, according to the report.

The report, “Out of Reach 2009,” was jointly released by the National Low Income Housing Coalition (NLIHC) in Washington, D.C. and the Minnesota Housing Partnership (MHP) in St. Paul.

The report provides data for every state, metropolitan area and county in the country.

“We hope that Out of Reach will demonstrate to policy makers the urgency of acting now to increase the supply of affordable housing and housing assistance for those who are hit hardest by the recession,” said Sheila Crowley, president of the National Low Income Housing Coalition.

Chip Halbach, MHP executive director and NLIHC board member, said one of the best ways to promote economic stability is through a stable housing market with a variety of housing types.

“As unemployment increases and Minnesotans continue to tighten their belts, we need to be sure there are housing options for people at all income levels. That means our communities need a healthy supply of both rental and owner-occupied homes,” said Halbach.

As is the case in rural areas of the state, rents in Douglas County are increasing at a faster pace than the statewide average.

Base rents for one to four bedroom homes here increased about 32 percent from 2000 to 2009, compared to a 26 percent increase statewide.

The rent situation for other parts of Greater Minnesota is just as sobering. The rents in rural counties have increased 34 percent on average since 2000.

Eight rural counties (Martin, Cottonwood, Faribault, Jackson, Murray, Pipestone, Rock and Watonwan counties) saw an increase of more than 50 percent in that span.

Renting a two-bedroom apartment consumes the entire median income for renters in 22 counties, nearly all of which are rural.

Topping the list of counties least affordable for its renters are Wadena, Isanti, Big Stone, Koochiching, Stevens, Lake of the Woods, Clay, St. Louis, Clearwater, and Todd counties.

The full report, including county and metro area statistics, is at the National Low Income Housing Coalition’s website, www.nlihc.org/oor2009.

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